Inside money, markets, and Big Tech

This article was published on March 23, 2021


Microsoft reportedly wants to buy Discord for more than $10B

Microsoft reportedly wants to buy Discord for more than $10B
Ivan Mehta
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Ivan Mehta

Ivan covers Big Tech, India, policy, AI, security, platforms, and apps for TNW. That's one heck of a mixed bag. He likes to say "Bleh." Ivan covers Big Tech, India, policy, AI, security, platforms, and apps for TNW. That's one heck of a mixed bag. He likes to say "Bleh."

Microsoft is out for shopping again and this time it wants to buy Discord, the communication platform for gamers.

This morning, Bloomberg reported that the tech giant wants to acquire the app for more than $10 billion — a hefty sum. In December, Discord raised $100 million at a $7 billion valuation, so it wouldn’t be surprising if the sale price is higher than $10 billion.

On Monday, VentureBeat reported that Discord is exploring multiple options, including a sale.

But a Microsoft acquisition is not the only possibility on the horizon for Discord. Bloomberg’s report also noted that it might even go public. Gaming-related stocks are hot right now, and the communication platform might be inspired by kid-friendly gaming platform Roblox’s stellar IPO.

Microsoft’s new-gen Xboxes

Microsoft’s effort towards attracting more gamers is not a secret. The company launched new-gen consoles last year and acquired popular gaming studios ZeniMax and Bethesda for $7.5 billion. If the firm ends up purchasing Discord, it might want to integrate some of its premium features, such as HD video and screen sharing, with the Xbox Game Pass offering.

As this news broke, some folkson Twitter were righty worried that Microsoft might just abandon Discord, just like it did Skype and its game streaming platform Mixer. While Skype is still around, its core features such as video calls were gobbled up by Teams.  It would be a stupid move for the company to take some features from the app and integrate them into Teams.

While Teams is similar to Discord in functionality, both serve a different audience that is accustomed to different workflows. Teams are more suited for workplace communication and cramming unrelated features in the app would just confuse everyone.

The coronavirus pandemic helped Discord grow rapidly as people spent more time sitting at home. Last December, the company said it had more than 100 million monthly active users who spent 4 billion minutes conversing with each other every day. During this time, folks started using the app for study groups, art communities, and even watching movies together. So Microsoft could potentially leverage this to target people who are not gamers, and expand Discord’s userbase.

There’s a possibility that these talks between these two companies may end up in a dud. Last year, Microsft was in talks to acquire short-video platform TikTok, and this year, it tried to gobble up hobbyist social network Pinterest. None of that happened, of course.

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